Policy uncertainty regarding the South African Reserve Bank
(SARB) and the expansion of its mandate has deepened factionalism within the
already-embattled African National Congress (ANC).
Recent cracks began to show in the wake of what was
reportedly a deeply contentious National Executive Committee (NEC) Lekgotla.
The gathering, held over the past weekend, sought to define focus areas of
implementation in the sixth administration under President Cyril Ramaphosa.
While tackling unemployment and breaking down the legacy of apartheid
spatial development were among the issues highlighted during the conference, contestation
surrounding Reserve Bank reforms exposed fissures of factionalism.
Ace Magashule throws the first punch
A fake tweet! You mean this tweet that was deleted? pic.twitter.com/U1mIVmaKie
— Pieter Du Toit (@PieterDuToit) June 6, 2019
On Tuesday, ANC General Secretary, Ace Magashule, announced
that the Lekgotla had resolved to expand SARB’s operational mandate. This
reiteration, which was also tabled at the party’s 54th national conference in
2017, has reignited the flames of division, not only within the ANC, but also with
SARB governor, Lesetja Kganyago, who has previously warned against threats to
the institution’s independence.
Following moans of contradictory policy uncertainty, the SARB spat spread to Twitter on Thursday. In a Tweet, that has since been deleted, Magashule announced:
“The ANC NEC Lekgotla agreed to expand the mandate of the SARB beyond price stability to include growth and employment.”
In a show of divisive political pettiness, Magashule then
tagged president Cyril Ramaphosa and ANC spokesman Zizi Kodwa. The Secretary
General has since alleged that his Twitter account was ‘hacked’.
Mandate of the Reserve Bank
Statement of Officials of the ANC regarding urgent Economic Priorities facing South Africa pic.twitter.com/r6yv1WOxnu
— African National Congress (@MYANC) June 6, 2019
This came shortly after Ramaphosa had issued a statement of
his own, saying, in summary, that the end goal was to have a publically owned
SARB but that current economic conditions wouldn’t allow for that transition to
be instituted just yet. Ramaphosa addressed the political spat, saying:
“The officials viewed the recent public spats about the mandate of the SA Reserve Bank as not being helpful, and mitigating and undermining the confidence of citizens and of investors.”
Ramaphosa echoed the sentiments of former Reserve Bank
governor turned Finance Minister, Tito Mboweni, who outlined the Reserve Bank’s
“Government sets the mandate for the SARB. There is no quantitative easing thing here. The primary mandate of the SA Reserve Bank is to protect the value of the currency in the interest of balanced economic growth and development.”
Jacob Zuma chimes in on SARB spat
Is there policy uncertainty? Here is a reminder of one of the resolutions at the last ANC elective conference in Nasrec pic.twitter.com/X26bb5vI1e
— Jacob G Zuma (@PresJGZuma) June 6, 2019
Not one to be outdone on matters concerning Radical Economic
Transformation, which includes the nationalisation of the Reserve Bank, former
president Jacob Zuma also took to Twitter on Thursday to ‘remind’ the ANC of
its SARB resolutions. Backing Magashule and the expansion of the Reserve Bank’s
mandate, Zuma said:
“Is there policy uncertainty? Here is a reminder of one of the resolutions at the last ANC elective conference in Nasrec.”
The post was amended with an outtake from the elective conference which states that the SARB should be 100% state-owned and that the ANC, as the ruling government, would be custodians of the transition.